The Role of Absorptive Capacity in Acquisition Knowledge Transfer

This article examines the role of absorptive capacity in acquisitions. We propose that absorptive capacity is an important determinant of acquisition knowledge transfer. Also, we identify antecedents of absorptive capacity in the specific context of acquisitions. These include contextual (national cultural differences), individual (employee withdrawal), and organizational design level (integration process communication, knowledge processing system) antecedents. We test our hypotheses on a sample of domestic and foreign acquisitions conducted by Finnish companies. This study contributes to the acquisition literature by elaborating on the role of absorptive capacity in acquisitions and to the general absorptive capacity literature by highlighting the importance of previously underexplored antecedents and outcomes of absorptive capacity.